PNK YOUTUBE

In preparation for PNK's Q4 earnings release tomorrow, we’ve put together the recent pertinent forward looking company commentary.

 

 

Pinnacle Entertainment Enters Into Definitive Agreements to Divest Boomtown Reno and Adjoining Land Acreage (11/10/2011)

  • Total proceeds from the transactions are expected to be approximately $22.2 million, with the potential for an additional $3.8 million if an option granted to the casino-resort buyer is exercised.
  • Sold to M1 Gaming Reno, LLC and SJP Reno Property, LLC for total cash consideration of approximately $12.9 million. In addition, the Company granted the buyers a one year option to purchase 100% of the Company's membership interest in the current gaming licensee, PNK (Reno), LLC and additional land adjacent to Boomtown Reno for $3.8 million. This transaction is subject to regulatory approval and is expected to close by mid-2012.
     

YOUTUBE FROM Q3 CONFERENCE CALL

  • "An interesting trend we're seeing is the growth from the younger customers, although the core growth is coming from 40 to 59 year olds, guests under 40 are increasing when compared to prior years. This growth from those under 40 is seen in both slots and tables, whereas tables usually skew younger."
  • "Bossier continues to be a difficult market while we have outperformed the market over quarter-to-quarter across our market segment, we believe this market will continue to be under some pressure."
  • "At Belterra, we believe the competitive dynamics of this smart deal will continue to be challenged for some time where our focus on rationalizing marketing reinvestment as well across all our portfolio, but particularly at this property, to improve results."
  • [myChoice] "We are recognizing expenses on our books ahead of the actual cash out flow. We have been very pleased with the performance of the program and the program remains at least cost neutral, and we expect to see additional improvements into operations as the program continues to see them."
  • "We continue to work through some of these changes and as stated we expect that the increase will be no more than 3% of the budget. And our opening day continues to be summer of 2012.  We expect to have a more definitive timeframe with a specific date by the end of the year as well."
  • "At River Downs we expect resolution of regards to the horsemen's fee subsidy by the end of the year. All of you likely saw the losses that was filed last week challenging the constitutionality of VLTs at racetracks. So there's more to come on this development in the coming weeks and months ahead. We remain hopeful that we will have authorizations to add VLTs at River Downs and that the redevelopment of that facility will start in 2012."
  • "Approximately $32 million was drawn at the end of the quarter, and as far as liquidity we also expect to receive a refund of the $25 million deposit that we had with the Louisiana Gaming Control Board for the Baton Rouge project following the opening of that facility."
  • [Capex] "We expect the fourth quarter to be roughly around $65 million of which $45 million of that should be Baton Rouge."
  • [St. Louis capex] "To relate to the second question on regards to the $82 million, about two-thirds of that won't get spent until '13, and the reason for this ageing is we wanted to limit our parking disruption associated with the construction there, so we're building the garage first, that should be in line by the end of the year, next year, and the hotel which is a big piece of that $82 million, and the multi-purpose room won't actually get going until '13. So from a timing perspective, two-thirds would probably be a good benchmark to assume goes into '13 versus what will go into '12. And we expect the complete project to be completed by the end of '13."
  • [Margin progression] "I will tell you that we're still in middle innings."
  • "The hotel on the Ho Tram Strip is already topped off and the low rise is closed to being topped off.  MGM, as the operator, is fully engaged and we are extremely encouraged by what we see the progress that they're making. We expect that that property will open the early part of '13, and to date, there's nothing to report on a change in the budget.  There was a financing that was completed prior to us investing of a syndicate of Vietnamese banks as we've noted earlier, and that financing is in place, there will be additional financing mostly driven by working capital needs that will get secured later on through the construction process, at some point towards the end of next year."
  • "We think that the environment from a marketing spend perspective has been very traditional throughout every market that we are in, and I think you've seen similar commentary I think from all our competitors, and that we hope it's sustainable, think that it has been tough to judge what other people will do."
  • "We continue with River Downs and every property to look at the most efficient way to run that property. It's highly unlikely that we're out of racing season right now. We in the simulcast. It's highly unlikely that you'll see in the current quarter where we're in, or even the first quarter, that we would achieve breakeven. You saw from the release that we did have an unusual one-time medical expense there, which we don't know, there could be another medical expense there, but we're working to just try to keep the loss there as small as we can while running a property that we feel good about our guests walking into. So, I would tell you the next couple of quarters you shouldn't expect to see us at a breakeven there, but you shouldn't expect it to be beyond what we reported this quarter, should be even a bit better."
  • [Baton Rouge] "A lot of the actual spend will actually come due until after the facility opens. In River City we saw our last set of bills, call it five, six months after the property opened. So, while it is going to be rather accelerated, by virtue of the delay we're actually able to go into fixed priced contracts on a lot of the things that were part of the GMP on the construction side, and over 95% of the hard cost is now known and under contract. So, we do think that while it will be accelerated next year, that we will be able to maintain that schedule."